December Jobs Report Puts Strong End to 2022
United States Secretary of Labor Marty Walsh published a blog at the beginning of the month, highlighting the latest jobs report from the Bureau of Labor Statistics.
According to the report’s findings, the American economy added 223,000 jobs during the month of December. The sectors with the largest payroll gains in December were leisure and hospitality (+67,000), education and health care (+78,000), and construction (+28,000).
The unemployment rate also decreased to a historically low percentage (3.5%) as a result of more people entering the workforce.
In reviewing the numbers from one year ago, Walsh pointed out that the economy added 4.5 million jobs over the 12-month period, marking more than 10.7 million jobs added since President Joe Biden took office—the most jobs added in a two-year period on record.
Employment in Construction
In a news release issued by the Associated Builders and Contractors, the Association found in its own analysis of the government data reports that on a year-over-year basis, industry employment has risen by 231,000 jobs or 3.1%.
In breaking down the numbers further, the report highlighted that nonresidential construction employment gained 17,900 positions on net, with growth in all three subcategories. Nonresidential specialty trade contractors added 10,200 net new jobs, while nonresidential building and heavy and civil engineering added 5,800 and 1,900 jobs, respectively.
“This employment report indicates that contractors collectively remain in expansion mode despite rising costs of capital and fears of recession,” said ABC Chief Economist Anirban Basu. “Consistent with upbeat assessments of construction activity late last year, nonresidential contractors continue to ramp up staffing in the context of elevated backlog. In ABC’s Construction Confidence Index, contractors indicated that both sales and employment would continue to rise over the next six months.
“There was additional good news emerging from the overall U.S. economy. Though the labor market remains strong and job creation persists, there are indications that wage pressures are easing. Nonetheless, the Federal Reserve will continue to raise interest rates to restore inflation to its 2% target, with the implication that a recession remains a real possibility in 2023. Based on historical precedent, that could produce more challenging times for contractors in 2024 and/or 2025.”
In its own analysis of government data, the Associated General Contractors of America also issued a news release. However, in addition to highlighting employment gains, the Association also noted that wages for hourly workers continued to raise more than other sectors.
Association officials said the data aligned with their recently released survey, which found the majority of contractors are optimistic about demand for most construction types, despite reporting difficulty filling positions.
“There are more people working in construction today than ever before, and those figures are likely to continue to increase,” said Ken Simonson, the Association’s Chief Economist. “But as optimistic as contractors are about 2023, they remain worried about their ability find enough workers amid record-low unemployment.”
According to the Association’s findings, average hourly earnings for production and nonsupervisory workers in construction—mostly hourly craft workers—climbed by 6.1%, from $31.25 in December 2021 to $33.15 last month.
The increase notably exceeded the 5% rise in average pay for all private-sector production workers. Such workers in construction now earn an average of 18.1% more per hour than in the private sector as a whole.
While both reports indicate positivity for 2023, Simonson further noted in the Association’s release that its 2023 Construction Hiring & Business Outlook survey, conducted with Sage, found 69% of the more than 1,000 responding construction firms expect to increase their headcount this year. Despite the hopeful outlook, however, 80% of survey respondents still reported having difficulty in hiring new workers.
“Considering where federal officials put their money, it is no surprise that contractors are having a hard time finding workers to hire,” said Stephen E. Sandherr, AGC Chief Executive Officer. “As much as they talk about rebuilding our economy, federal officials still don’t seem ready to invest in the people needed to do all that building.”
Looking Ahead
“With significant gains in health care, leisure and hospitality and construction jobs, we rounded out 2022 with more of the steady, stable growth that helped our workforce recover from the COVID pandemic and has empowered workers to take on new opportunities,” wrote Walsh.
“We begin 2023 positioned to sustain this worker-centered progress, as the Administration’s infrastructure investments and the resurgence of American manufacturing continue to create good jobs across the country.”
Walsh noted that soon the nation’s Inflation Reduction Act will also go into effect. Back in August, PaintSquare Daily News reported that the $3 billion in grants included in the act would support equity, safety and affordable transportation access to rework roads and infrastructure.
The Neighborhood Access and Equity Grants are also expected to reconnect communities divided by existing infrastructure, mitigate negative impacts of transportation facilities or construction projects on communities, and support equitable transportation planning.
According to reports, the new grants also work to supplement the $1 billion funding from the Reconnecting Communities Program through the bipartisan infrastructure law. The program aims to help jurisdictions address the division of neighborhoods, pollution and other harms caused by past infrastructure projects.
The latest grants can reportedly be used to cover a highway or convert it into a boulevard, add bike lanes or sound barriers, provide better transit connections, build “green” stormwater infrastructure, curb air pollution or reduce urban heat island hot spots, among other plans.
However, unlike funding from the bipartisan infrastructure bill, the IRA funds cannot used to build single-occupant car lanes. Additionally, the funding is expected to improve clean transit by addressing diesel emissions and cleaning up ports.
In addition, the Department’s Good Jobs Initiative and other efforts are aiming to ensure that all working people have the skills supports, protections and opportunities they need to thrive.
More recently, in November, President Biden recognized more than 350 organizations in the nation’s 50 states for their commitments as part of the Infrastructure Talent Pipeline Challenge.
Initially launched in June by the Biden-Harris Administration, the nationwide initiative calls on employers, unions, education and training providers, states, local governments, Tribes, territories, philanthropic organizations, and other stakeholders to help support equitable workforce development.
The Challenge is focused on three sectors: broadband, construction and electrification.
Thanks to the bipartisan infrastructure law—along with the CHIPS and Science Act, Inflation Reduction Act, and American Rescue Plan—millions of union jobs are being created, and the Challenge is ensuring that workers across the country are being properly trained for these jobs.
Through them, nearly 150 employers, unions, and community-based organizations will create or expand pre-apprenticeships, registered apprenticeships and other high-quality training programs. In addition, more than 60 organizations will increase recruitment among workers who are traditionally underrepresented in infrastructure sectors, while nearly 30 organizations have pledged to provide supportive services, such as childcare and transportation.
Advancements in equitable workforce development will also be carried out by over 50 institutions of higher education focused on infrastructure jobs. And lastly, more than $70 million in aligned philanthropic commitments will be used to advance the goals of the Talent Pipeline Challenge, which is expected to impact tens of thousands of underrepresented workers.
